Kakao to Hold IR on Spin-Off in Hong Kong and Singapore, Court Overseas Investors
IT DAILY ·
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Kakao will hold an IR session for overseas institutional investors in Hong Kong and Singapore on the 11th and 12th.
At the IR, it will explain the background and purpose of pursuing the spin-off, the roles and growth strategies of Kakao AI and KakaoX after the split, and will also hear investors' views.
Kakao decided on the 5th to buy back and cancel KRW 150 billion worth of treasury shares before the split, and the planned date for the extraordinary shareholders' meeting to approve the split is Jan. 15, 2027.
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Kakao will hold an investor relations (IR) session for overseas institutional investors in Hong Kong and Singapore ahead of its spin-off. The purpose of the IR is to explain the business restructuring plan and raise market understanding of the split. The schedule is Nov. 11-12, and the venues are Hong Kong and Singapore. About 10 overseas investors and institutions are expected to attend.
At the event, Kakao plans to explain the background and purpose of pursuing the spin-off, as well as the roles and growth strategies of Kakao AI and KakaoX after the split. It also plans to hear the main concerns and views of overseas investors. According to Kakao's announcement, CEO Chung Shin-a and Kim Do-young, the chief executive nominee for KakaoX, will attend.
Kakao announced its spin-off plan in August. At the time, Kakao presented the establishment of a decision-making system tailored to each business and the establishment of a capital allocation structure as its policy for the spin-off.
The business restructuring plan centers on Kakao AI for AI, advertising and commerce, and KakaoX for techfin, content and mobility. The newly established company will be Kakao AI, which will focus on AI, advertising and commerce businesses linked to KakaoTalk.
The surviving company will be KakaoX. KakaoX will support the growth of major affiliates such as techfin, content and mobility, and take charge of discovering new growth engines. Through this IR, Kakao has created an opportunity to directly explain to overseas investors the roles of the two entities after the split.
Kakao has moved up the schedule so that part of its previously planned share buyback and cancellation program, originally set for after the split, will be carried out before the split. On the 5th, Kakao held a board meeting and decided to buy back and cancel KRW 150 billion worth of treasury shares before the split. This will bring forward half of the KRW 300 billion share buyback and cancellation plan that KakaoX had originally planned to carry out after the split.
Kakao will use cash dividend funds from Kakao Investment to proceed with share buybacks starting on the 6th, and plans to cancel all acquired treasury shares. The remaining KRW 150 billion will be bought back and canceled by KakaoX within 2027.
Kakao also disclosed shareholder return standards for Kakao AI and KakaoX. Kakao AI's shareholder return policy uses 20% to 35% of separate adjusted free cash flow (FCF), and if FCF increases by 50% or more from the previous year, the shareholder return ratio will be raised to as much as 40%. KakaoX's shareholder return policy uses 30% of after-tax dividends from subsidiaries and 30% of capital gains after deducting capital costs and taxes.
Kakao adjusted the spin-off schedule and ratio to reflect its asset allocation and treasury share cancellation plan. Accordingly, the planned date for the extraordinary shareholders' meeting to approve the spin-off is Jan. 15, 2027, and the planned spin-off date is Feb. 1. The planned date for the change listing and relisting is Feb. 25.
Kakao held communication sessions with domestic investors before the overseas IR. It held two meetings with minority shareholders in September and October, and also held a joint analysts' meeting with executives from key affiliates. At the joint analysts' meeting, it explained the purpose of the split and the medium- to long-term growth plans for each business.
A Kakao official said the company expects this meeting will allow it to directly gauge what overseas investors are curious about and how the market views the company. The official also said the company will reflect feedback from the field in future market communications and that it aims to give investors opportunities to continuously review the growth strategies and performance of both companies.
Source: IT DAILY · Kim Byung-joo
Original: https://www.itdaily.kr/news/articleView.html?idxno=242836
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Source: IT DAILY
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